HL Deb 02 August 1956 vol 199 cc563-95

2.48 p.m.

LORD SILKIN rose to call attention to the position in relation to the Suez Canal; and to move for Papers. The noble Lord said: My Lords, I beg to move the Motion standing in my name. In discussing this question we are under two very serious handicaps. The first is that at this moment a debate is taking place in another place on the very same subject and it is difficult to avoid a certain amount of repetition; and we have not, as we usually have, the benefit of having heard authoritatively what is being said in that other place. The other difficulty is that discussions are at this moment taking place between France the United States of America and ourselves which are not concluded, and it is obviously impossible for Her Majesty's Government to make any definite statement as to what their course of action is going to be. For both those reasons our debate is likely to be of a somewhat limited character. I imagine that if we could have postponed this debate for a week it would have been much more profitable but probably less popular. Nevertheless, we say it is better to have a provisional debate of this kind than to disperse without your Lordships having the opportunity of expressing your views on the most critical situation which has arisen since the end of the war, and one which may have far-reaching consequences.

The events of the last week in connection with the Suez Canal are sufficiently well known to your Lordships, so that it is not necessary for me to give you a detailed narrative. I will state only the facts in so far as it may be necessary to explain the outlook of my noble friends and myself on this crisis. Without any notice whatever, Colonel Nasser announced that he intended to take over the Suez Canal Company, and did so within a matter of hours. I say Colonel Nasser, rather than Egypt, because, obviously, this is not the action of a Government, as we understand it; it is the action of a dictator. Whether, in fact, he has consulted the Government, or whether, indeed, there is a Government in Egypt to consult, most of us do not know. But it is important to take into consideration, in deciding on our actions, the fact that we are dealing with one man. Perhaps if we had been a little more farsighted we might have anticipated that something of this kind would come along. Colonel Nasser had given a clear warning in the past in connection with his embargo on shipping to and from Israel that he would have no scruples about breaking an international convention when it suited him, and I cannot help feeling, without in the least desiring to be controversial this afternoon, that it is a great pity that we did not take stronger action at a time when it was open to us to do so. And I cannot help feeling that Colonel Nasser has had some encouragement from our silence or lack of action in the past.

He has now decided to nationalise the Suez Canal undertaking, and his reason for doing so is, obviously, in the main, his failure to secure a loan from ourselves and the United States in order to carry out the project of the Aswan Dam. I think we were probably right in refusing this loan. He had made it plain from his actions that he would not be in a position to carry out the financial terms of any such loan. Any moneys that might be available had already been earmarked for payment for arms, and it was exceedingly problematic whether any further sums would be available. Your Lordships will, no doubt, take the view—as I do—that the nationalisation of the Suez Canal Company will not, in fact, provide the funds except on the basis of confiscation. Colonel Nasser has stated that it is his intention to pay the market value of the shares in Paris on the day before nationalisation took place, but that remains to be seen.

There are a great many calls on the profits of the Suez Canal Company. Which, I understand, amount to about £10 million a year. There is continuous need to deepen and widen the Canal to take larger and larger ships, and in the period of about 80-odd years during which the Canal Company has been in existence the Canal has been widened on no fewer than eight separate occasions. A widening operation is actually taking place at this moment. It began last year, and the estimated cost of it is about £18 million. There is the service that will be required of the compensation fund, if Colonel Nasser decides to carry out his expressed intention and pay for the shares—which in itself will practically absorb any avail- able profits that may arise from the working of the Canal. There are the pension rights of British and French employees. We must not overlook the fact that a good many British and French employees have earned pension rights, and it is at least doubtful whether it is the intention of Colonel Nasser to carry out that obligation. Then, of course, there is the need for constant maintenance and improvement of the Canal. I think it is right to say that during the whole of the period of the existence of the Company they have discharged their obligations in the most meticulous manner—notably in the way in which they have carried out these improvements even though they have been aware of the fact that the term of their lease was coming to an end.

The proposed development of the Aswan Dam is not the only reason for the action that Colonel Nasser has taken. There is also the question of endeavouring to secure the leadership of the Arab Group, which has been Egypt's particular ambition in the last few years. It is very largely a question of prestige. Colonel Nasser is personally ambitious of becoming leader of the Arab world, and a dramatic and spectacular move of this kind is calculated to make a very strong appeal to the Arab world—particularly if the move succeeds. I think it is important for us, in considering the situation, to bear in mind that the position is very different indeed from what it was at the time when the Charter was granted. In 1868, when the Canal Company first opened, the amount of traffic passing through the Canal was relatively insignificant. It amounted to about 500,000 tons a year. Last year it amounted to 115¾ millions tons—an enormous increase. And it is used to a greater or lesser degree by practically every maritime nation in the world. It is, today, beyond question, the largest waterway in the world, and, no doubt, the most important.

It is used to a very considerable extent by us. We are substantially the largest users, and that explains the considerable interest we have in the Suez Canal. Indeed, looking at the figures, I should say that our use of the Canal is greater than that of the next four countries put together. So it is a very substantial interest that we have. Indeed, I would go so far as to say that it is a vital interest, and we should be seriously affected economically if anything happened to impede the free progress of shipping in the Suez Canal. It is true that Colonel Nasser has stated categorically that he has no intention of impeding the free use of the Canal, that he will observe the Convention in detail and that no particular changes will be made to the present position. But can we believe that?

One fact which stands out is that an important aspect of this question is the need to keep the Canal going and fit for its present use. It is necessary to spend large sums of money annually on maintenance and to continue to expand it as and when necessary; and it is quite impossible to believe that within the financial ambit of what is available to him Colonel Nasser will be able to carry out these obligations or, for that matter, that he has any intention of so doing. Of course, there is scope for increasing charges, but that is a very serious matter and one that should not be entrusted to one individual. It is an international matter and it should not be in the hands of one individual to effect a stranglehold on transport throughout the world by arbitrarily increasing charges, not according to what is necessary for the maintenance of the Canal, but, in fact, to pay for arms that he has bought from some other country.

There is some doubt about the legality of what Colonel Nasser has done. I do not pretend that the matter is free from doubt. For what my opinion is worth—and I say this with all humility in the presence of far greater international lawyers than I can ever claim to be—I think that what he has done is not legal. I will not bore your Lordships by trying to give my reasons, but, to put it no higher, there is a considerable element of doubt about whether his action is legal at all. I have no doubt at all, however, that the manner of doing it constituted in itself an illegality. I feel that that is a matter on which we can all stand.

I said at the outset that Her Majesty's Government were in a difficulty in this debate—unless anything has happened since twelve o'clock, which I doubt—in making any definite statement on what the course of action will be, but we on this side cordially welcome the statement of Her Majesty's Government: that the freedom and the security of the Suez Canal, in peace as well as in war, is of world importance and cannot be entrusted to any one nation. For that reason, we welcome the discussions that are taking place. At the moment, the discussions are between France, the United States and ourselves. Obviously, this is not a matter for Egypt alone. It is also not for ourselves alone, though perhaps that is a little more difficult to realise. It is a matter of world concern. In the view of noble Lords on this side, the more nations we can bring into the discussions, the better. I think that it was a mistake to limit these discussions to France, the United States and ourselves, unless we can regard them as merely preliminary discussions, conducted with a view eventually to bringing in others. I feel that we ought to have brought in the Soviet Union. Once before we made a great mistake in not taking the Soviet Union seriously and bringing her into discussions at an early stage. We must not make the same mistake again.

I do not know, any more than your Lordships do, what the attitude of the Soviet Union will be; but I do know that in 1946 they took the view that international control by the nations concerned through a United Nations agency was essential, and I have no reason to think that they do not take that view to-day. Indeed, it is in their own interests that that view should be taken, because I am sure that they have no greater reason to trust Colonel Nasser than we have and there is no indication that they have done so. So, at an early stage, we should bring in as many other maritime nations as we possibly can, with a view to creating a world opinion; and we certainly should bring the matter within the ambit of the United Nations. We on this side approve also the economic measures that have been taken so far, and we think that we should immediately stop supplying arms not only to Egypt—that is axiomatic—but also to any other nations that have given sympathy and approval to the action Egypt has taken. There are a number of nations who have sent encouraging Notes and whose Press is cordially in favour of what Egypt has done, and I think that that should be noted in dealing with the question of the supply of arms.

As a long-term measure, the suggestion which the noble Lord, Lord Hore-Belisha. has put forward in recent days in this House is, I feel, worth considering; but he will appreciate that it is a long-term measure. The Suez Canal took twelve years to complete, I think. It may be that we move faster these days—I am not sure. But at any rate, it is a long-term measure. It is, however, possible to do something less ambitious immediately by the construction of a pipeline over the same kind of territory as the noble Lord has in mind I think that there is one thing we could do. If we are not to supply arms to the nations which are likely to be unsympathetic to us, we could supply arms to the nations that are likely to be sympathetic—I refer particularly to Israel. It may well be that if we find little positive action that we can take immediately, Colonel Nasser will be encouraged to take aggressive action against Israel; and in my view the time has arrived when Her Majesty's Government might well consider supplying Israel with those arms which they might otherwise have supplied to the unfriendly nations

That is all that I have to say We are in this dilemma: but all we can do at this moment is to put forward our own point of view and our suggestions. I would ask the noble Marquess the Leader of the House not to hesitate to call us back, if it should be necessary, in order to get the views of your Lordships' House. We are in a very grave crisis, and I am sure that no noble Lord would feel at all disturbed about having it well-earned rest interfered with if t were necessary in the interests of our nation. We shall watch with great apprehension what is taking place. It is just possible that before the debate is ended, the noble Marquess who leads the House may have a statement to make. If so, of course, he will make it. I beg to move for Papers.

3.10 p.m.

LORD REA

My Lords, I do not propose to follow in detail the interesting and, if I may say so, moderate and helpful speech of the noble Lord, Lord Silkin. At this stage in this affair that we are discussing to-day—and a most important affair it is—it is hardly to be expected that each member of each political Party will necessarily agree in full detail with all of his colleagues. That refers to the short-term view. But in the longer term, I feel that I am probably speaking for all Members, in all quarters of the House, when I say that we loyally support Her Majesty's Government in all the action they are taking and the efforts they are making at the present moment. At this stage of this difficult case one must make a little reservation about the future, because this crisis—if I may call it a crisis—is by no means resolved, and it may take one form or another before we know exactly where we are. But even though we may reserve that right of criticism, I would repeat that we support Her Majesty's Government to-day in all that they are doing.

It is regrettable to know that in this new world of ours, where young nations, and what used to be called "backward" nations are coming more to the front of that world picture in a way where inter-State independence is much more important than before, there are in those younger countries unfortunate elements of xenophobia and nationalism which do not help that quick progress, and do not really represent the best feelings of the best statesmen in those younger countries. It is particularly regrettable that this unrepresentative element, as to a large extent it is, should have reared its head in this country of Egypt, which has been our friend for so long; which has in its background a high civilisation, and which has been so near to Western culture for so many generations. Those of us who have had the pleasure of visiting Egypt have met statesmen and others there who I am sure are most uncomfortable and most unhappy that this apparent dictator is taking a line which does not represent what is in Egypt's best interests, and is known to the Egyptians as such. It is, of course, necessary that we should deal with this matter with cool heads and with meticulous examination. It is easy to be affronted by this insulting approach which has injured our amour propre, but I know that your Lordships will agree that in such cases it never pays to retaliate in the same temper.

It is difficult in this debate to go into much of the detail, because there is so much on which we still await information —information which, perhaps, is not readily available, even to Her Majesty's Government. But I hope that the noble Marquess who is speaking next for Her Majesty's Government will be able to tell us something about what led up to the present situation in respect of the Aswan Dam: what were the negotiations between us and Egypt and us and America; and what was the reason why we did not take the action that we might have taken when shipping to Israel was interfered with in the Canal?

Is it true that if Egypt had not taken the action she has done, the position in 1968, when the Suez Canal Company Agreement comes to an end, would have been roughly as it is now? In other words, is this a mere anticipation of what was to come? If that is so, I would join the noble Lord, Lord Silkin, in saying that we agree with the Prime Minister that this international highway should not be in the hands of one nation; in fact, we think it should be looked after by the United Nations, or as many of the United Nations as can be made interested in it. That does not quite accord with the conference which existed in 1888, referred to in a Question earlier this afternoon by the noble Viscount, Lord Stansgate, because the members of that conference did not include Russia and did not include the United States.

VISCOUNT STANSGATE

They did include Russia.

LORD REA

I beg your Lordships' pardon. They did include Russia, but not the United States. If that conference is to be revived, I think it should be revived under a much wider umbrella, which would be represented only by the United Nations; and there should be no hesitation in asking, pressing and begging both the United States and Russia to come in and deliberate with us on this international question. It must be remembered that there are many maritime States who do not appear to be very important in that part of the world but who yet depend fully, as the noble Lord, Lord Silkin, has said, on this international highway. It is interesting to know that Norway comes high up in the list of users, whereas Russia is low down; but both of them must be interested from the international point of view.

We are at a disadvantage, too, in that there has been no really full statement from Out Prime Minister, although some of us know something of what has gone on in another place to-day. Nor, as yet, has our Foreign Secretary given us any indication of his views. However, that is natural, because the whole situation is still in a state of flux. That is why I rather doubt whether it has been wise to initiate these two debates in the two Houses of Parliament at this stage. The function of debate, surely, is query and suggestion and criticism; and I doubt whether, at this stage, we can offer to Her Majesty's Government any constructive criticism, make any constructive suggestions or raise any queries which would not be normally answered if they were suitable to be answered. Therefore, I feel it is regrettable that arrangements have been made, presumably by the two larger political Parties, for this debate to take place to-day.

I feel that it should have been left until the situation had crystallised and come more into perspective, in order that the Government should have a quiet time for intense and level-headed consideration, especially if there is contemplated any question of military action which would need careful consideration. I am sure that the opinion of the people of this country would have to be sounded before any such step could even be advanced at all. Therefore, if this matter does crystallise in such a way that we can usefully help, I do beg the noble Marquess who leads the House to be good enough to remember the promise that he kindly made last night, that the House will be recalled if there is any indication that its reassembly can help in this vital, dangerous and delicate situation.

3.18 p.m.

THE MARQUESS OF READING

My Lords, it will, I hope, be in accordance with the wishes of the House if I intervene at this early stage in the debate and endeavour to give some indication, as fully as is possible in the circumstances of which your Lordships are aware, of Her Majesty's Government's attitude towards, and the principles which are guiding them in, the undoubtedly grave situation that has arisen in Egypt. I regret that I am not in a position to give your Lordships any fuller information as regards the present discussions than was given earlier to-day by my right honourable friend the Prime Minister in another place; but if there is anything that can be said at a later stage, my noble Leader, who will wind up on behalf of the Government in this debate, will, of course, include it in his speech.

I have called it a grave situation; and such it undoubtedly is, both in its intrinsic character, and also, and perhaps even more so, in the attendant circumstances. By the recent Egyptian move the best-known and most widely used international waterway in the world, the essential traffic link between East and West, the creation of which resulted in untold saving of time and money to peaceful commerce between nations, has been abruptly snatched into the hands of one Government alone—and that a Government headed by a man who, so far as we and our friends are concerned, has now proved himself, beyond doubt, hostile, rancorous and irresponsible.

We had genuinely hoped that, with the signing of the Agreement for the evacuation of the Canal Zone, an era of cordial relations with Egypt might begin. In spite of all our efforts and our approaches, it was not to be. Colonel Nasser's own ambitions. and the seething torrent of Egyptian nationalism, which he and his associates have done so much to excite and exploit, and so little to moderate and control, have swept aside all our endeavours and all their protestations. After a series of alternations of moods, in which the angry ones grew always more angry and the calm ones less calm, Colonel Nassar has now purported to nationalise, in purely Egyptian interests, this great international shipping route, and to appropriate its revenues to internal Egyptian uses. There can scarcely be a country whose shipping benefits from that Canal which does not feel itself shocked and menaced by such high-handed action. Your Lordships may have noticed that President Eisenhower said yesterday, in this context, that the continued efficient use of the Canal was vital to the economy and future welfare of the United States —and there are many countries who would echo that sentiment from apprehensive hearts.

The Egyptian Government claim that they have taken this step by way of retaliation. Retaliation for what? Not for the withholding from them of something to which they were entitled as of right. but for the withdrawal, in changed circumstances, of an offer which they themselves had not accepted but had complicated by a whole series of provisos, qualifications and reservations; an offer to furnish them with generous financial aid. And because that aid is no longer to be made available, they claim to be justified in measures of retaliation. The noble Lord, Lord Rea, asked me for the circumstances in which that offer had been withdrawn. I think they were made reasonably plain at the time: that the course of the Egyptian economy which had been followed by the Government in the interval between the original offer and the time of its withdrawal was such as to shake confidence in the fabric of the Egyptian economy and to make it extremely doubtful, to put it mildly, whether it was an economic proposition to make available to them the resources which had originally been offered.

VISCOUNT STANSGATE

May I ask the noble Marquess a question on that? Was the offer withdrawn by the World Bank, or was it withdrawn by the State Department?

THE MARQUESS OF READING

The offer was withdrawn by the State Department.

It may well be that the refusal to produce funds for the building of the Aswan High Dam was not the cause but the excuse for the purported nationalisation of the Canal Company. Indeed, the speed with which the intricate legal instruments necessary to carry out their purpose were sprung upon the world is at least some indication that they were already in cold storage, awaiting a propitious moment. If that is so—and I would certainly not rule it out—then it may well be that this is only a further, though a more flagrant, step in a deliberate policy to undermine and destroy by stages our whole position in the Middle East. But in either event the world cannot sit idly by whilst the Canal lies at the mercy of fitful gusts of wrath or of studied political plots.

But, say the Egyptian Government, why are you in the United Kingdom complaining, when you yourselves not so long ago nationalised your coal, iron, steel and transport? That was a very different story. These were purely British concerns, the shares in which were British-held, and their nationalisation affected no foreign country. Moreover, ample notice was given, and the principles and procedure to be followed were agreed by the then Government with those concerned. Here the Suez Canal Company have very important and very large foreign shareholders; and, what is still more serious, its function is to operate an international waterway which is of vital concern to many other countries.

The noble Lord, Lord Silkin, in his speech, made some remarks in passing, if I may so characterise them, as to the legality of the Egyptian measure. I am disposed to agree with the conclusion at which he arrived, but I do not think that it would be a profitable exercise, or one perhaps easily conducted, to expound at great length the reasons; nor are they perhaps for this purpose very material.

The point is: What is the declared purpose of this nationalisation? It is to procure revenue—the declared purpose of the Egyptians—not for the more efficient operation and maintenance of the Canal but for the construction of the Aswan High Dam. It is true that the Egyptian Government have now made a feeble effort to contend that the reason lay in the fact that the Company was neglecting the Canal, but everyone, not excluding the Egyptian Government, knows that that allegation is utterly untrue. Only last year, as the noble Lord, Lord Silkin, remarked, a costly new scheme of enlargement was put in hand. If this was the reason—if the reason really was that the Suez Canal Company was failing in the task committed to it—why carry out the operation of nationalisation from one hour to another? Why not gradually, and by agreement? The inference is, of course, only too plain—that it was done at this moment as a vindictive challenge to the West, even if it be also part of a longer-term plan. It is a challenge to far more countries than the United Kingdom, the United States of America and France. And it is a challenge that can be neither palliated nor ignored. The noble Lord, Lord Silkin—and the noble Lord, Lord Rea, made the same point—said that our action in this matter should not be unilateral; and I am wholly in agreement with them. It is because Her Majesty's Government share that view that these present consultations are proceeding in London.

We cannot, great maritime nation that we are, accept the proposition that a vast international service, such as the Canal supplies, can be recklessly milked of its resources for the construction of a Dam for the international benefit of Egypt alone. What a prospect for the future of the Canal! Its relatively modest revenues are to be charged not only with the payment of compensation to shareholders, but with the cost of this immensely extensive engineering enterprise as well. And the Egyptian Government would presumably maintain that, when all this money had been earmarked for these uses, for the Dam and for the compensation, there would still be a sufficient surplus to carry out the expansion of the Canal itself for which they now try to say the Company has failed to provide: an expansion which, as has already been noted, becomes from year to year the more necessary and on a larger scale because of the increase, not only in traffic but in the size of the ships which constitute that traffic. It would be difficult to calculate the level to which the Canal dues would have to be raised if all these heavy burdens were to be discharged. No one country, certainly not Egypt in its present mood, can safely be left in what my right honourable friend the Prime Minister, recently called "unfettered control" of this indispensable artery.

Colonel Nasser announced the nationalisation in a speech in which historic distortion and political venom were nicely blended, a speech which seemed a tragic echo of styles that we knew too well in the inter-war years and had hoped would never assault our ears again. How can we and other countries confidently entrust the smooth, efficient and impartial administration of the Canal to hands already shaking with passion? How can the Canal be properly operated by men who are held to their posts by threat of imprisonment? The threat in itself is surely a breach of International Law.

If we were tamely to submit to this coup de theâtre, with the Arab nations as the audience, Colonel Nasser would not be satisfied but stimulated. No dictator can ever afford to be satisfied. What would follow? At his will, a stranglehold on our essential oil supplies; by his caprice, a stoppage of troop movements, supplies and commerce; at his word, an exhorbitant increase in Canal dues. Moreover, such examples are infectious, and there are others in his neighbourhood who are not wholly immune from a similar virus. It may have been that it was to a large extent a question for Colonel Nasser of increasing his prestige. We have a prestige, too, and we are determined to maintain it. In Her Majesty's Government's solemn and considered view, there is only one solution. We cannot afford to lay ourselves and our future open to such hazards. The Canal must be placed under effective and trustworthy international supervision and control. It is to secure that object that we are at this moment engaged in careful consultation with France and the United States. That is the basic decision of principle. I hope and believe that it will commend itself to the whole House. It was not lightly taken; it will be steadfastly pursued.

3.33 p.m.

VISCOUNT STANSGATE

My Lords, I thought it would be more convenient and seemly if I spoke from this Bench, in case at any point I happened to disagree with my noble Leader on the Front Bench. I do not think I shall. I went to another place this morning and I can correctly and sincerely say that I found much more reason, common sense and conviction in the Prime Minister's speech than there was in the rather heady wine which was produced by my own Front Bench. We are all agreed that we will be firm—that is a most important thing. The Liberal Party is going to be firm; it is going to be united. Those are two most remarkable phenomena. We are all agreed that the House must rise to-day —that is very important. We are all agreed that there must be a conference and we are all rather vaguely in our minds aware that nothing much will be done. That seems to me to be the whole picture.

I admire the eloquence of the noble Marquess the Minister of State. I enjoy it but I wonder what he is going to do. If a man has committed a crime—I am not a lawyer; I hope some legal Member of your Lordships' House will speak to-day—I understand that there are three things involved. First of all, you must frame a charge; secondly, you must have a court and, thirdly, you must have a means of imposing your judgment. What is the charge? My noble friend below me, who is a lawyer, says in a vague way that he thinks, though he "will not at this moment weary your Lordships with the particulars," that there is a breach of, not the Concession, but the Convention. The noble Marquess, Lord Reading, gave some support to that view. I hope that someone will tell us exactly what the breach is. There is an affront—there is a violent affront. There is a lot of propaganda which is very bad indeed. But I cannot discover—and I have read what the newspapers have said; there was something in The Times this morning or yesterday by a lawyer—that legally speaking Colonel Nasser has done anything in breach of the law. That is the first point. I hope that one of the Law Lords will illuminate this matter for us.

Before what court are you going to bring this man? You cannot bring him before the Hague Court, because it is not a governmental affair. You cannot bring him before the United Nations, because it concerns an Egyptian company. The only court you can bring him before is the highest Egyptian court in the land. I cannot remember all the details now, but a few years ago the British Government had a dispute with the Canal Company about whether the payment on the debentures or the ordinary shareholders should be in gold francs, or something of that kind—I did not understand it. But the British Government took the Canal Company to the Egyptian courts to have the case tried. I rather fancy that we won our case. Therefore, if you go to court, so far as one can make out from information that one can gather, the only court before which the case can be tried is an Egyptian court, and it has not been possible, except in the inferential way which my noble friend mentioned, to frame a charge.

We are all very angry about this affair; everybody is very angry about it. Colonel Nasser has behaved in an unconscionable way. If you read back a little in The Times—you need not go very far back—you come to the time when Colonel Nasser was the "blue-eyed boy" when we offered him the money; when the International Bank offered him the money, and when he felt that the conditions were too severe. It is not important, but as a matter of fact I talked to him for about an hour at Christmas-time on this point, and he said: "I am very friendly". He is a very friendly man—I am speaking in a social sense; I am speaking not in a national sense but in a personal sense. He said: "You and the Americans offer us money, but there are so many conditions, such as, 'You have got to make peace with the Jews', 'You have got to make an agreement with the Sudan', and 'You have got to do something about this and that.' But when the Russians make an offer, they say simply, 'There is the money'."

I said to him, "Are you not aware that it may be very dangerous to have a vast horde of Russian technicians here? You may get Communists amongst them, for I am afraid there are Communists even in engineering." He said "I do not know anything about the Russians. I want the money. I understand I can have both." I understand it is the International Bank which decides the economic points. The State Department decides the political points; Congress decides that foreign aid must stop. Your Lordships know what Congress is like at the end of a term. Suddenly their State Department gives an order "It is off", and, of course, we, the British, had to follow suit. If your Lordships will look at The Times about a fortnight ago, you will see streamlined an alleged statement by Mr. Shepilov, that the loan was "not a live affair". How we chuckled! How we rubbed our hands and said, "We will show this fellow Nasser!" Then, all of a sudden, he got the loan; all of a sudden he reared his head; all of a sudden he gave us this terrible punch on the nose which has hurt our prestige and has angered the whole of the nation. That is the situation, as I understand it.

I want to make a short interlude here, if your Lordships would be patient, about the views of the Egyptian people themselves. I know Egypt pretty well. I first went there 53 years ago. I have been there in the Services and engaged in negotiations. I was the guest of my noble friend Lord Killearn over there. I have been there in various capacities. What this country has got to understand is (because the only service we can render in this House is to produce the facts) that a complete revolution has taken place in Egypt. For nearly a hundred years, with our participation, an Albanian House which was detested by the people of Egypt was ruling Egypt. After a great deal of hesitation and misunderstanding with the French, in the 1880's we took on the job of being responsible for the stability of the régime. The Rulers did not like us but they were glad enough that we were there. I was there for five or six months in 1946 negotiating with King Farouk. I do not really think he wanted us to evacuate the Canal at all. But we were the backbone.

Ismail was financially, as we all know, a scamp of the worst order. People were lending money to Egypt at exorbitant rates and it was being wasted or spent on paying the Sultan to enlarge the privileges of the Pasha. Finally, we made our scoop and Mr. Disraeli—or Lord Beaconsfield, I think he then was—paid the £4 million and got the Khedive's shares. I hope your Lordships will forgive me, because I am trying to bring facts forward which must be well known to your Lordships, and to shape them into a little picture. Your Lordships must realise that this is how the Egyptian peasants look at the Canal and at us. When the Concession was given, the corvée was brought in and when Nasser speaks about the thousands of lives lost he is speaking the truth—the Egyptians know it; it was done by the corvée. To the great credit of Lord Cromer and of our intervention, we abolished the corvée in Egypt. Therefore, to the Egyptian peasant the whole transaction merely represents a foreign Power, Great Britain, supporting and manipulating an alien ruling House with the fellaheen nowhere at all. I leave the matter now. But it is very important that people should realise what the great mass of Egyptians who are going to the polls in a few weeks, really think about this subject.

Disraeli was an amusing writer and he wrote to Lady Bradford the day after he had made the great scoop—a Sunday, I think it was—when the Rothschilds got the £4 million and we bought the Khedive's shares. He wrote to Lady Bradford: We have had all the gamblers, the capitalists, the financiers of the world, organised, platooned in bands of plunderers. That is what Disraeli said about the financial arrangements which launched the Canal. It is a long time ago and it is easy to say that this is all past history, but it is what the Egyptians are thinking about in regard to this talk of how much they may spend on the dam, and what right they have to the Canal and what they spend on arms from abroad, and what price they get for their cotton. To the Egyptians, all this means the return of an international control of the budget, and there is nothing you can do which would irritate and inflame them more than making suggestions of that kind.

I myself do not think that necessarily the situation is bad. When I said that Nasser was a friendly man it was received with derision. I do not think he wants to make trouble, but he wants to justify his revolution; and to do that he must have money, he must have the dam and he must irrigate the desert. He says that nothing in this action is an infringement of any international obligation. although politically it is a most insulting thing to do. There is nothing, he says, that is internationally illegal. I hope he will seek an interview with my noble friend below me, who can explain these doubts and fears to the President of the Egyptian Republic.

There is a simple solution available. An instrument is ready to hand. No doubt your Lordships have read it. My noble friend Lord Rea read it, because he put in the point about Hungary and Austria. This Convention is a marvel of organised machinery for controlling the international use of the Canal. Its drafting is wonderful. Not only does it lay down everything for which people are asking, but it also sets up a body that has to meet annually in Cairo to see that it is being done. It says that the agents of all the signatories are to meet in Cairo every year. I should like to ask the noble Marquess—of course, he cannot answer right off—whether he would ask the Foreign Office what happened to that Committee which was set up, I think under Article 17 of the Convention—I do not know the exact number. The Convention said that not only would this agreement be operative but that there would be a watchful body which would meet annually to see that it was operative.

THE MARQUESS OF READING

Is that the Committee of Agents? That is Article 8.

VISCOUNT STANSGATE

Yes, that is right. I just wonder what happened to it. It is an Agency. The thing is all framed up. If you put in Russia, as Lord Rea wants and I think everybody wants —apparently the United States, too—then you have got your Agency and you can see that the international use of the waterway is assured and our rights are protected, and there is no need for any trouble at all, if it is agreed to. It is a practical suggestion, and I dare say would not be entirely unacceptable to the Egyptian Government.

Now I want to say just a word about economic measures. I am not at all a business man. I am sorry the House is rising to-night because I had it in mind to put a Motion on the Order Paper objecting to the Statutory Instruments under which these measures are taken. If I had had the chance to do that, then a Minister would have come here and explained it all to us. I suppose that it is all right. Certainly the French are in a difficult position, as they have immense assets in Egypt. As the noble Viscount, Lord De L'Isle, knows, we ourselves have £200 or £300 million worth of property at the Base, including Centurion tanks, so that before one starts to get "rough" on money affairs one needs to look round very carefully. I do not know. but it may be all right. I am perfectly confident that Her Majesty's Government have all that in mind.

As regards the other suggestion made by the noble Lord, Lord Hore-Belisha, for a new canal, that may be a good idea, though I do not know whether there is anything against it in the Concession. I have read the Concession which we gave to de Lesseps. In that we said that we would not allow any other Concession on the Isthmus. Whether or not the canal proposed by the noble Lord, Lord Hore-Belisha, would be banned by the orginal Concession I do not know; but at any rate he proposed a canal which would run up some hills in Israel and down some other hills in Israel, and then land in an Egyptian lake. On the whole, it does not seem to be a very profitable or constructive idea, but no doubt the noble Lord will explain it to us later.

Speaking generally about Israel, may make a suggestion—and it is one with which, I believe, Israeli statesmen would agree: do not attempt to use Israel as a pawn in the game in fighting the Arabs. That would be a fatal mistake. The Israelis do not want it. The place for Israel is as an honoured, skilful and valued member of the Middle Eastern community—that is the real place for Israel and people who think that they will make her a fifth Dominion, or get a base at Haifa, or anything of that kind, are doing the worst possible disservice to that State. The existence and prosperity of Israel is, in my judgment, the most important thing in the Middle East. Anyone who has been there quite recently will have seen how these people work, how they lose their country. We need not give them aid, although they may want guns and other things to defend themselves; but everyone there is burning to defend his country. It is vital that that country should be protected. I do not want to disagree with Her Majesty's Government, but it is unfortunate that, for reasons of caution, or because we did not want to offend the Arabs, or because we thought we could play in with the Egyptians, we did nothing at all when a flagrant break of law did occur, such as has been the subject of all this eloquence tins afternoon. That in itself has "blotted our copy book"—not fatally, I agree. But at any rate it is a fact that the whole world knows we would not stop Egypt blockading Israel.

The Canal is only one instance of a world-wide anti-Semitic blockade which is going on through the Arab Bureau. Now, we ourselves are affronted on this same point. I want to ask the noble Marquess the Leader of the House, when he replies, to say something about the islands at the mouth of the Gulf of Akaba. I believe that (no doubt to keep the peace with the Arabs) we have an arrangement by which we undertake to give private notice when we are going through channels which we are entitled use without any prior notice. Something of that kind happened in Albania, and we took them to court. As a result, we got a cheque for a large sum, although of course it was never honoured. I should like to ask a question on this matter of freedom of passage (I tried to put it in a supplementary question the other day), because I believe that the freedom of water is vital and must apply to the Gulf of Akaba as well as to the Canal of Suez. I believe that we are internationally justified on that point.

We can bring into active operation the Convention of the Suez Canal; I was very grateful for the Answer which I received to my Question on that subject to-day. We can say to the Soviet Union: "You signed the Convention. You always had an interest in the Mediterranean. Join with us." After all, although we fought the Russians in the Crimea in the late 1850s, by the 1870s they were back and joining in an international Convention governing Egyptian affairs; so that it is not an impossible task for us to do what I am sure they themselves would wish —namely to bring them into the Great Power Group of the United Nations dealing, I should hope, with the Middle East. I do not think that means they are to be won away. I do not believe for a moment that the Russians want war. I do not believe that they want to stir up anybody else to make war; but, of course, a little trouble among other people is always a comfort to a diplomat.

My Lords, just one other point: what are you going to do? I was deeply stirred, as I always am, by the eloquence of the noble Marquess, Lord Reading. He said that when injustice is done, justice is bound to follow; and that crime will be followed by punishment. I was delighted to hear that. But what punishment? How are you going to start? Supposing this man is absolutely wicked, and says: "I do not care a snap of the fingers for you; I am going ahead."? What do you do then? In June, 1882, there was a bloody riot in Alexandria, and though we were very annoyed, we did not do anything at the time. Peace was restored through Arabi Pasha, who is the political ancestor of Nasser, who is the lineal representative of the Egyptian revolutionary of 1881. That was the affair in the Rue des Soeurs. I have read of it for, having nothing to do when the noble Earl, Lord Attlee, sent me to Egypt. I just read books.

In those days of might, when we had the spirit shown by the noble Marquess. Lord Reading, to-day, we did not like a thing like that to happen; so a month after the whole thing had been settled, mostly by the intervention of Arabi Pasha, we sent twenty-two warships. To-day, I do not think we have got twenty-two warships altogether. When we sent those warships to Alexandria, Admiral Seymour saw somebody (I do not know whom) and said, "Unless you stop building that mud fort I shall bombard it." The Egyptian said "I will not stop." So the Admiral bombarded it with his twenty-two warships. Then Sir Garnet Wolsey appeared and marched with one battalion and took Cairo. I wonder whether there is anybody who really believes that the whole of the Disraelian affair was a success? I do not think so. I think it was a great failure. It has all "gone to pot" now—the Indian Empire, the Suez Canal, the Sudan, the Boer War—all gone. If I were going to make a peroration (which I am not) I should suggest that we reassess our problems and look at things anew. That is what we have to do. So long as one is a Kipling man, and really believes that Disraeli was right with his methods, his bombardments and his battalions flying the flag—that Union Jack which, when I was in Cairo in 1946, still flew bravely on the tuzrrets of the Citadel—if one believes in all that, then this is the way to act. But if we do not, if we think that the British Commonwealth has a mission. then we have to look elsewhere and consider what is the effect of this.

I want to ask the noble Marquess. Lord Salisbury, when he replies, to answer some of these not very difficult general questions. Her Majesty's Government have talked about taking action. If they are not going to take action, then the sooner the House rises and we have a conference (once Luxembourg and San Marino have accepted invitations), which eventually peters out, or there is a Test Match or something like that, the better. That is the best solution of all.

Her Majesty's Government have talked very bravely about taking action. Suppose that they take some violent action, put Sir John Slessor on to it—he is "atom-happy" and believes in might—what is going to be the effect on our British Commonwealth and on the world in general? Let me catalogue the countries of the Commonwealth. Canada has not sent a note of reproof to Nasser; South Africa has not sent a note of reproof to Nasser. India—well, I do not know; but the matter was not discussed at Brioni. That is all we know from Mr. Nehru. Then, is Pakistan going to join in this great attack on Egypt? What becomes of the Baghdad Pact? Have you asked Nuri Said about it? He is in London now. What does he think of this business? What about Persia? The Shah of Persia has just paid a very friendly visit to Russia. And what about Jordan? Fifteen million pounds a year we are paying to Jordan at present. A nice friendly telegram was sent by Jordan to Nasser—at the expense of the subsidy, of course—congratulating him on what he had done.

You may say these are just niggling little points. In a way they are details, but they are part of a bigger picture. There is a group of countries, centred on India and spreading over the Middle East, which does not desire to get involved. Like Nehru, they want a peace-loving area which will not join in the ancient Imperial fights. If Her Majesty's Government take action against Egypt I believe it is, if not inevitable, almost certain that the whole Arab League, and all their friends, will join in the other side. That is something which must not be thought of. It is all very well for the Daily Mail and the Daily News—yes, and the News-Chronicle, whose desertion of Liberal principles is one of the most shocking features of the Press to-day; but I beg Her Majesty's Government to hear these things in mind.

It is dangerous to quote poetry in this House, but there are some lines of Kipling which I should like to repeat. I detest most of Kipling's poetry, but some of it is very good. May I quote just four lines from a poem which I consider very moving and very apt in the present connection? The poem is entitled The Old Men, and I address these lines with great respect to your Lordships: The Lamp of our Youth will be utterly out: but we shall subsist on the smell of it,

  • And whatever we do, we shall fold our hands and suck our gums and think well of it,
  • Yes, we shall be perfectly pleased with our work, And that is the perfectest Hell of it!
With those few words, I beg leave to support—I suppose that is the word—the Motion of my noble friend Lord Silkin.

4.2 p.m.

VISCOUNT DE L'ISLE

My Lords, we always listen with attention, if not always with agreement, to the noble Viscount, Lord Stansgate. I cannot think of any four lines which would better epitomise his point of view or his speech than those lines of Kipling's which he has just quoted. I think it is just as well that he speaks from the Back and not from the Front Benches. I would categorise his speech in his own words—a lot of niggling little points. When I listened to the speech of the noble Viscount, Lord Stansgate, I was reminded of days before the last war when former Liberal statesmen called upon a great German dictator and fawned upon him

In considering this subject to-day, I think it cannot be too strongly emphasised that we confront the gravest of situations which has arisen since 1939. I believe that the fate of the whole of the free world as well as of this country depends upon the actions and the policies of Her Majesty's Government in the coming days. The Suez Canal is a vital artery for the whole world, and above all for the Western Nations who, of course, own the preponderance of the maritime fleets of the world. Europe, if she is to maintain in economic progress and momentum n the face of great competition, must have oil supplies from the Middle East. I take it—and this being so my speech will be very short—that the facts are plain. They have not even been obscured by the speech of the noble Viscount. They are plain both to Europe and Asia, and I hope they are equally plain to the United Stales of America.

The facts are that if Colonel Nasser gets away with this action, in the long term he will blackmail and bleed the West of their oil supplies, nominally for the building of the Aswan Dam but primarily for the gratification of his sense of power. The Egyptian dictatorship will slip from him if he fails. But if he is successful in his present course the whole of the interests of the West in the Middle East will disintegrate. Those are the plain facts. I should welcome a world conference upon this question. But if there is to be a summons to Egypt it must be in unequivocal terms. It must ask Egypt to come on the basis of internationalisation of the Suez Canal, and not to a conference at which the internationalisation is to be discussed. That must be the summons.

Lord Stansgate was right in asking Her Majesty's Government what they intend to do. There must be an "either or". Where I differ from him is that I think we have the power and the right to insist, if necessary by force of arms, upon the proper answer to our question. There is no way round. If the matter runs into the sands, not only the fate of this country but the fate of the West, and with it the fate of the United States, will be settled and a third world war will be measurably nearer. Therefore, I welcome the speech of the noble Marquess because it was a strong speech. I hope the actions of Her Majesty's Government—for they have not only the right but the duty to lead in this matter—will be consequent on that speech. Colonel Nasser, I feel sure, is saying that possession is nine points of the law. We have the tenth. But it is a point which will rust if not used. I beg Her Majesty's Government not to delay but to bring these matters to an issue in the shortest possible time.

4.7 p.m.

LORD KILLEARN

My Lords, it would be tempting to preface my observations to your Lordships by saying "I told you so", but that would not be very helpful, although it would be completely true. I should not even have thought of mentioning the fact that I did tell you so but for one of the observations made by Lord Silkin when he opened the debate. He referred, I think, to the question of Egyptian good faith. I could not help remembering how from that Box—it was the only time I have ventured to speak from that Box—I expressed a doubt to the House on that very point. It was in regard to the 1936 Treaty of Alliance with Egypt. That Treaty was approved with acclamation by the Egyptians, and when it came to signing it they sent to this country as signatories the heads of all the Egyptian Parties. I think there were some twelve or thirteen of them. They signed with the greatest joy and acclamation. I ventured at the time of the evacuation talks to remark to your Lordships that the good will and the good faith of Egypt were not all that good, as instanced by the tearing up of the 1936 Treaty though signed by all Egyptian parties thereto.

I would now turn to the issue before us. We are all agreed that the issue which we are now discussing could not be graver. It is, in fact, a direct and deliberate challenge of the highest and most sinister political significance. Are we prepared to let Nasser get away with it? Make no mistake about it. This is a testing time. It is not a testing for Nasser alone. It is a testing for all of us. It is a testing for this country. Such at least, is my view. I feel very strongly that this is a time when we have a great opportunity, and I hope, and I believe, that we are going to take it. The issue before us, it seems to me, falls under two heads. One, the long-term, is the ultimate fate and the securing effectively of the rights of free navigation of the Canal as prescribed in the Constantinople Convention of 1888. There is the other and what I might call the shorter-term answer. That comes more on the political side, to which I have just alluded. So far as the long-term issue is concerned, we know that it is now actively engaging the attention of Her Majesty's Government in concert with others. I personally hope that, in pursuing it, whatever the arrangement agreed upon may be, it will take some international form—the form of an international guarantee of some sort deriving from the prescriptions which regulate this right of free navigation laid down in the Constantinople Convention

Some doubt has been expressed in certain quarters as to why we are making all this "song and dance" over the nationalisation of an Egyptian company. I disagree with that argument. I believe that we have a legal case. It is not for me to go into it, but surely when you have something—I am talking about the Canal Company—which has, as its sole object and sole subject a full-blooded international Treaty behind it, you cannot reasonably say that this is a normal question of the nationalisation of a normal national enterprise. I believe that we should have a good case if this came to law.

In another place this morning we heard some fine declarations, which have done us all a power of good. I only hope and pray that we do not get held up by technicalities and petty legal points, and so let the thing drag on; because, as I said at the beginning, this is essentially a political question, and a political question of the highest and most serious import. I repeat, it is a deliberate challenge. I have used that phrase before and I use it again. Your Lordships may remember that the day before yesterday a leader in The Times described Nasser's action as "piracy". That is a very good expression—it is piracy. Pirates are pirates, after all, and when we catch a fellow at it, he deserves short shrift. He ought to be treated like the pirate he proves himself to be. That is generally recognised as the right thing to do. Moreover, it is certain that if this is allowed to pass, the example will spread. It has already been said by one speaker to-day that this sort of poisonous example is bound to spread. And so it will. That is all the more reason for us to act, and act quickly.

I come back to my point, even ad nauseam: that this is primarily a political matter, as was so clearly and admirably enunciated by the Leader of the Opposition in another place to-day, in an altogether admirable speech. There are political issues of the gravest import at stake, and accordingly it is a great relief that Her Majesty's Government are prepared to be courageous, even at some risk; and, as I hope and believe, have given and are giving the nation that strong and firm leadership which the public have the right to expect and are so eagerly awaiting. With the full and unanimous support of your Lordships' House, let Her Majesty's Government act swiftly and, if necessary, drastically. In my humble opinion, we have already delayed too long.

I end as I began, with this question: are we going to let Nasser get away with it? I hope and trust the answer is, No.

4.14 p.m.

LORD HORE-BELISHA

My Lords, the only useful purpose of this debate, which takes place in the middle of other and more operative discussions, could be to show our resolve and our solidarity; and I think that both have been shown, with one possible exception (though I am not sure that it is an exception): that of my noble friend Lord Stansgate.

VISCOUNT STANSGATE

No, my Lords. I must correct my noble friend—he is my noble friend. My only dissent was that I preferred the Prime Minister's speech to that of my noble friend Lord Silkin. That is all.

LORD HORE-BELISHA

My statement has had the valuable effect of re-emphasising that opening remark of my noble friend, but I thought that in some statements which he made—I hope he will correct me here, too—he was rather presenting the point of view of Colonel Nasser; and that he did, I am sure, out of his well-known balanced sense of justice. It is important that we should have that point of view, of course, and I am sure that the noble Viscount does not completely identify himself with it, despite certain doubts which he submitted.

VISCOUNT STANSGATE

My Lords, I do not want to interrupt my noble friend, but he must be well aware that it is the duty of anyone in this House to try to present the facts. If he is trying to pretend that I would support, or would have supported, the action of Colonel Nasser, he is wrong. I neither said nor did anything of the kind. If the noble Lord wishes this to be a House that hears only the side of one person, he is right. But my contention is that this House has this; wonderful feature; that people can present other people's cases in order to help. That is the whole point.

VISCOUNT DE L'ISLE

My Lords, if the noble Viscount takes that point of view, does he understand that Mr. Gladstone was Prime Minister in 1882?

VISCOUNT STANSGATE

My Lords, I am glad that the noble Viscount has found that out. Of course, he was Prime Minister—but what has that to do with it? Is he going to take strong action on that? I hope that my noble friend Lord Hore-Belisha, when he has finished with me, will give a few hints to the Government on how this "firm action" is going to take place—it ought to be this week or next. What are we going to do?

LORD HORE-BELISHA

My Lords, I think that after that elucidation I may leave the speech of my noble friend—and he is my noble friend—to speak for itself. I have no desire to misinterpret it, and, like everybody else, I enjoyed it.

I agree with the noble Viscount that this issue will be determined, not by anything which we say here to-day, but by what we do to-morrow. It is not a week since the Canal Company was nationalised. I think that the Prime Minister expressed the mind of the nation in his firm reaction. I think that he interpreted the true instincts of a maritime country. He did not take any narrow point of protest against the principle of nationalising a company. He did not dwell on any legal niceties. He did not even confine himself to insisting on free passage through the Canal. I had myself anticipated that in the first instance he would confine himself to that step, because in that he could have had no possibility of opposition from any quarter outside Egypt. But he went further and has insisted, on behalf of the Government, that the Canal shall he administered internationally. That is the clear policy enunciated by Her Majesty's Government. There can be no retreat from that policy without a complete loss of our respect and prestige in the Middle East. That is where we stand. The Prime Minister, in a powerful speech, has reiterated that position this afternoon.

VISCOUNT STANSGATE

My Lords, the noble Lord is making a most interesting and constructive speech. I never realised that this international body was to take the place of the Canal Company. Is it to hold their shares? I should like more details.

LORD HORE-BELISHA

My Lords, my noble friend is not quite so innocent as he sometimes pretends to be. What the Prime Minister said was that: No arrangements for the future of this great international highway could be acceptable to Her Majesty's Government which would leave it in the unfettered control of a single power which could, as recent events have shown, exploit it for purely national policy.

VISCOUNT STANSGATE

That is the 1888 Convention.

LORD HORE-BELISHA

Let us not put any gloss on the Prime Minister's statement. I think it is far better if, as a nation, our policy should be clearly stated and understood, as I think it is understood. I do not think it is necessary to confuse it in any particular. That is the policy of Her Majesty's Government. A conference of three of the principal Powers is being held, as I understand it, to discover a means of implementing that policy. I take it—and the country and the world have taken it—that the policy represents the fact not only that we intend to carry it out but that we have the means of carrying it out. The next step, we are told, will be perhaps a wider conference. I have complete confidence that we shall not fall into the trap of merely summoning a conference of the Powers to discuss this matter generally. Otherwise Colonel Nasser will continue to administer the Canal and the outcome of the conflict of attitudes will be postponed until the Greek Calends. It is important that any conference which is summoned should he summoned on the basis of this declaration of Her Majesty's Government, in order to establish machinery for carrying it into effect. I assume that that is what will be done; and if that be done I feel that Nasser will have his complete answer and that our prestige will he restored in the Arab world.

There is another aspect of this matter on which I would desire to say one or two words It has been said—and it was said, I am told, by a Foreign Office spokesman—that we were taken by surprise. If that should be so, this is only the first of the surprises. There are going to be other surprises so long as Nasser is the ruler of Egypt and people of his conviction are in control. It was not a surprise to most of us, because it is in the complete logic of events. This is part of the irresistible logic of nationalism, and anybody could have seen four or five years ago that this was bound to eventuate in some form or other. I must say that I rather deplore the criticism that is sometimes made—and I do so with great respect—of any constructive suggestion of a long-term character on the ground that it does not solve our immediate difficulties. Five years ago I put forward this idea of another canal. In fact it is not my idea. It may interest the noble Viscount who has just spoken and who quoted de Lesseps to know that de Lesseps, as I have been informed, actually considered a possible route leading into the Gulf of Akaba.

VISCOUNT STANSGATE

Yes, that is so; and Sosotris constructed a canal to the Red Sea in 3,500 B.C.

LORD HORE-BELISHA

But not by the route I am advocating.

VISCOUNT STANSGATE

No.

LORD HORE-BELISHA

And it was not a canal that would serve much purpose at the present time as the Suez Canal does.

VISCOUNT STANSGATE

It is only a matter of history.

LORD HORE-BELISHA

What I am saying is this: that whenever we have a crisis of this kind and anyone comes forward with a long-term suggestion, which may take months or years to implement, he is told: "We cannot attend to that matter now"; and when the crisis is over or in suspense then everybody forgets about it. If five years ago we had undertaken a project such as I have been advocating, I think we should have been in a better position. The mere threat of building an alternative to the Suez Canal would have had a powerful effect on Colonel Nasser's actions. I have reason to know that that was the case from the reaction to the speech I made two and a half years ago, reviving this suggestion. I did not say that we should build a canal immediately. I quite recognised that that would take some time. I did, however, suggest that we should make a pipe line immediately, and that is a question of a few months' construction at extremely small cost. We have great experience of these matters and the terrain is not an obstacle. The thirty-inch pipe line which goes for 555 miles between Kirkuk and Banias was laid by the Iraq Petroleum Company in seventeen months at a cost of £41 million; and it is estimated that a medium borehole pipeline between Akaba and Haifa, which would be about 290 miles long, could be laid for somewhere between £10 million and £20 million. I feel that this matter should be considered.

The noble Viscount, Lord Stansgate, says that a canal is impracticable. That is exactly what Lord Palmerston said about the Suez Canal. Some extremely strong language was used by Lord Palmerston (I forget if he was then Prime Minister or Foreign Secretary) and I have one quotation here. He said: The British Government will use all the influence it possesses to frustrate the realisation of this project. That was said of the Suez Canal on which we are told to-day we vitally depend and without which we could not exist. Lord Palmerston went on to say that the Canal is physically unpracticable "— which is exactly what my noble friend Lord Stansgate was saying this after-noon— and would be far too costly to earn any return. Everybody knows that the annual revenue of the Suez Canal is two or three times the original capital cost, so nobody could dispute that those who advocated that canal showed some foresight.

All I plead for—because we are not out of the wood—is that this matter should be seriously investigated. The whole tenor of the speech of the Prime Minister to-day was: "The Canal is indispensable to us; it is not big enough, the traffic on it is crowded. In the next 10 to 15 years"—and that is a long-term policy if ever there were one— "it will have to be vastly enlarged". But this Canal—the Suez Canal—will remain in Egypt; it will still be the sole highway; it will still be subject to sabotage, whatever new arrangements we make. And if the present legal arrangements are allowed to he fulfilled, in 1968 the Egyptian Government will become the undisputed legal owner of the Canal. I therefore plead with Her Majesty's Government to consider this matter seriously. The Shell-Dutch group announced only two or three weeks ago that they were projecting a pipeline from Marseilles to the northern ports of Europe at a cost of £100 million. What is the use of a pipeline between Marseilles and Northern Europe if the oil cannot get into the Mediterranean at all? So, without desiring to examine in detail the engineering difficulties, I plead for a serious study to be made of this subject, and I am sure that the foresight will be justified.

VISCOUNT STANSGATE

I do not. take the view of Lord Palmerston—but, of course. I am glad to be put in that category. However, I want to ask the noble Lord whether he will tell us if he has dealt with the free entry into the Gulf of Akaba. That is the whole point.

LORD HORE-BELISHA

I am glad to have that interruption. Now we are told —and it is the sole objection raised, so far as I can understand, to the construction of a pipeline, and a fortiori of a canal—that the entrance to the Gulf of Akaba can be menaced by batteries on the Egyptian and Saudi-Arabian coastlines. The use of force on a free waterway, to prevent the right of innocent passage being exercised, is not only an act of piracy, but an act of war. Are we to be told that Britain and the whole Western world is going to submit to a threat of that kind, and allow itself to be denied access through art open waterway? It is of the nature of waterways that they are commanded by the contiguous land. We do not accept from any other Powers in the world, or any other nations of the world, threats of that kind.

VISCOUNT STANSGATE

The noble Lord must know that for several years we have been not only submitting, but conniving, in the imposition of this blockade.

LORD HORE-BELISHA

I do not think that that is a comprehensively true statement. I think it has certain aspects of truth in it. But, as the Prime Minister said this morning, Israel's shipping through the Canal has been stopped, and it has also been stopped through the Gulf of Akaba. The United Nations have taken cognisance of the matter and nothing effective has been done. But this is a matter of far wider import, and if we are going to insist on the right of passage through the Canal, as we are going to insist, it will cover Israel presumably in the future, and we will also insist on similar rights in the Gulf of Akaba. The rights are there. Whether we wish to knuckle down and say to anybody who seeks to obstruct us, "All right; if you do not wish us to take this route we will go round the Cape," well and good. That would be a base surrender.

It is also said that some of the Arab countries would not deliver their oil if it had to pass through Israel territory. If suppliers of oil, on which they are entirely dependent for their welfare, are going to impose dictation upon us of the routes which our commerce is to take or not to take, it would be inconceivable that we should accept. We do not accept from suppliers of our tea and copper and all the other commodities which we use a dictation as to the routes which the goods will take after the commodity has been purchased. But I do not think for one moment that the independent sheikdoms on the Gulf would take that attitude. They are entirely dependent, as we are dependent in another sense, on this oil supply—they for selling and we for buying. If, however, we lie down before this threat from Colonel Nasser, then we shall not have any case against anybody in the future. This is a test case, as has been said by my noble friend, and I plead with the Government—while assuring them that I, amongst many millions of other people, are behind them wholeheartedly in this matter, as is the whole country and, I think, the whole of democratic Western. Europe—that we may not confine ourselves merely to a consideration of the short-term measures which could be taken, but that we should look forward imaginatively to longer and more constructive proposals which will ensure our future independence in oil supplies and, indeed, in all commodities.